EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (this “Employment
Agreement”), dated as of March 26, 2007, by and between
TheStreet.com, Inc., a Delaware corporation (the
“Company” or “TheStreet.com”), and Steven
Elkes (“Elkes”).
WHEREAS, the Company desires that Elkes enter
into this Employment Agreement, and Elkes desires to enter into
this Employment Agreement, on the terms and conditions set forth
herein;
NOW THEREFORE, the parties hereto agree as
follows:
Section 1. Duties; Term.
(a) The Company agrees to employ Elkes, and
Elkes agrees to be so employed, in the positions of Chief Revenue
Officer and Executive Vice President, Mergers & Acquisitions,
responsible for the coordination of all revenue-generating and
mergers and acquisitions activities of the Company, and Elkes
agrees to perform such duties, functions and responsibilities as
are generally incident to such positions, reporting to and subject
to the direction of the Chief Executive Officer, for a period
commencing on March 26, 2007 (the “Commencement Date”)
and ending on March 25, 2009 (the “Expiration Date”),
unless sooner terminated in accordance with Section 4 hereof (the
“Term”). Elkes agrees to perform faithfully the duties
assigned to him pursuant to this Employment Agreement to the best
of his abilities and to devote substantially all of his business
time and attention to the Company’s business. Elkes shall be
subject to all laws, rules, regulations and policies as are from
time to time applicable to employees of the Company including
TheStreet.com’s Policy on Investments and Code of Business
Conduct and Ethics, and will be required to comply fully with the
provisions of all written supervisory procedures and other relevant
securities and disciplinary policies relevant to his position with
the Company.
(b) Notwithstanding the foregoing, Elkes also
may serve on the board of directors or advisory committee of other
enterprises subject to the consent of the Board, which shall not
unreasonably be withheld; provided , however , that
Elkes shall not serve on more than two such boards at the same
time.
Section 2. Compensation.
(a) Annual Salary . As compensation for
his services hereunder, during the Term the Company shall pay to
Elkes a salary of Three Hundred Thousand Dollars ($300,000) per
annum, payable in accordance with the Company’s standard
payroll policies, and less all applicable federal, state and local
withholding taxes (the “Annual Salary”). The Annual
Salary shall be reviewed at least annually during the Term, and may
be increased in the sole discretion of the Company’s Chief
Executive Officer and the Com-
pensation Committee of the
Company’s Board of Directors (the “Board”),
taking into consideration both the Company’s and
Elkes’s performance during the preceding year.
(b) Bonus . Except as set forth in
Section 4 hereof, in addition to the Annual Salary, Elkes shall be
entitled to receive additional bonus compensation, which may be
cash and/or equity compensation, for his employment during calendar
years 2007 and 2008 (the “Annual Bonus”). The Annual
Bonus will be structured as follows: (i) seventy percent (70%) will
be based upon the mutually agreed upon annual incentive bonus plan
for management and other significant employees of the Company,
which shall be based upon achievement of the Company’s
financial and operational goals as approved by the Compensation
Committee, and (ii) thirty percent (30%) will be based upon
pre-established individual performance goals, as approved by the
Committee with meaningful input on all goals from the Chief
Executive Officer. The target level for the Annual Bonus will be
65% of the Annual Salary.
(c) Options . Elkes will be awarded
stock options, under the terms of TheStreet.com’s 1998 Stock
Incentive Plan, as amended (the “Plan”), and
TheStreet.com’s standard stock option agreement (the
“Option Agreement’), to purchase up to 100,000 shares
of TheStreet.com common stock. These stock options will vest and
become exercisable on an annual basis at the rate of one-third per
year on each of the first three anniversaries of the grant date,
and will be priced at “fair market value”, which is
defined in the Plan as the closing price of TheStreet.com’s
common stock on the Nasdaq Stock Market on the last business day
before the grant date (which is the Commencement Date).
Additionally, the Option Agreement will contain a clause providing
that upon the occurrence of a Change of Control (as defined in the
Plan) prior to the termination of Elkes’s employment
hereunder for any reason, one hundred percent (100%) of the then
unvested portion of the stock options will immediately become
vested.
(d) In addition to the Annual Salary, the
Annual Bonus and the stock options, Elkes may, in the discretion of
the Compensation Committee of the Company’s Board of
Directors, be granted awards under the Plan on an annual or other
basis as compensation for the performance of his services
hereunder.
Section 3. Benefits; Expense
Reimbursement.
During the Term, Elkes shall be eligible to
participate in any group insurance, accident, sickness and
hospitalization insurance, and any other employee benefit plans of
the Company in effect during the Term and available to the
Company’s executive officers, and Elkes shall have the right
to reimbursement, upon proper accounting, of reasonable expenses
and disbursements incurred by him in the course of his duties
hereunder. In addition, during each year of the Term, Elkes shall
be entitled to three (3) weeks of paid vacation.
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Section 4. Employment
Termination.
(a) At any time during the Term, and except as
otherwise provided in Sections 4(b) and 4(c) hereof, the Company
shall only have the right to terminate this Employment Agreement
and Elkes’s employment with the Company hereunder, upon
written notice to Elkes, in the event Elkes engages in conduct
which constitutes “Cause.” For purposes of this
Employment Agreement, Cause shall mean (i) Elkes’s willful
misconduct or gross negligence in the performance of his
obligations under this Employment Agreement, (ii) dishonesty or
misappropriation by Elkes relating to the Company or any of its
funds, properties, or other assets, (iii) inexcusable repeated or
prolonged absence from work by Elkes (other than as a result of, or
in connection with, a disability), (iv) any unauthorized disclosure
by Elkes of confidential or proprietary information of the Company,
which is reasonably likely to result in material harm to the
Company, (v) a conviction of Elkes (including entry of a guilty or
nolo contendere plea) involving fraud, dishonesty, moral turpitude,
or involving a violation of federal or state securities laws, or
(vi) the failure by Elkes to perform faithfully his duties
hereunder or other breach by Elkes of this Employment Agreement and
such failure or breach is not cured, to the extent cure is
possible, by Elkes within thirty (30) days after written notice
thereof from the Company to Elkes. If this Employment Agreement and
Elkes’s employment with the Company hereunder is terminated
for Cause, or if Elkes voluntarily resigns from the Company without
Good Reason, during the Term, the Company shall pay Elkes an amount
equal to all earned but unpaid portions of the Annual Salary and
unused vacation days through the date of termination, and following
any such termination, Elkes shall not be entitled to receive any
other compensation or benefits from the Company hereunder
including, without limitation, any portion of the Annual Bonus for
the year in which he is terminated.
(b) This Employment Agreement and
Elkes’s employment with the Company hereunder may also be
terminated by the Company without Cause, or by Elkes upon the
occurrence of an event constituting Good Reason. For purposes of
this Employment Agreement, “Good Reason” shall mean (i)
the failure of the Company to cure a material adverse change made
by it in Elkes’s functions, duties, or responsibilities in
his positions with the Company as provided in this Employment
Agreement, or (ii) a reduction in the Annual Salary during the
Term, or (iii) the failure of the Company to cure any other
material breach of this Employment Agreement, or (iv) Elkes’s
relocation by the Company or a successor thereto to a location more
than fifty (50) miles from either the Company’s current
headquarters or Elkes’s home address, provided
that , in the case of (i), (ii), or (iii) above, the Company
has failed to cure the event constituting Good Reason within thirty
(30) days following written notice thereof from Elkes.
(c) In the event that Elkes’s employment
is terminated by the Company without Cause, or by Elkes with Good
Reason, then the Company shall pay or provide to Elkes, as his sole
and exclusive remedy hereunder, (A) an amount equal to all earned
but unpaid portions of the Annual Salary and unused vacation days
through the date of termi-
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nation, (B) a pro rated (based
on the number of days employed in the year of termination or
resignation) bonus for the fiscal year in which such termination or
resignation occurs (a “Pro Rated Bonus”), and, (C) for
an additional twelve (12) month period, (i) group life, disability,
sickness, hospitalization and accident insurance benefits
equivalent to those to which Elkes would have been entitled if he
had continued working for the Company, and (ii) the Annual Salary
to the same extent to which Elkes would have been entitled if he
had continued working for the Company. The Pro Rated Bonus shall be
calculated at the end of the applicable year as if Elkes had been
employed through year-end, and shall be payable to Elkes within
five (5) business days of the date such bonuses are paid to
management and other significant employees of the Company. The
Annual Salary payments provided for in (A) above, the Pro Rated
Bonus provided for in (B) above and the benefits continuation
provided for in (C) above shall be contingent upon Elkes’s
continued compliance with Sections 5 and 6 hereof, and Elkes shall
be obligated to repay all such payments upon determination by one
arbitrator in accordance with the Commercial Arbitration Rules of
the American Arbitration Association that Elkes has failed to
comply as such with Sections 5 or 6 hereof. Additionally, the
benefits continuation provided for in (C) above shall terminate
upon Elkes becoming eligible for corresponding benefits in
connection with new employment. Except as set forth above, Elkes
shall not be entitled to receive any other compensation or benefits
from the Company hereunder.
(d) If in connection with the occurrence of a
Change of Control, there is a significant reduction of
Elkes’s authority, duties or responsibilities over the
Company’s activities, relative to his authority, duties or
responsibilities over such activities in effect immediately prior
to such reduction (but not if such reduction in authority, duties
or responsibilities over the Company’s activities occurs as a
result of the Company being acquired and made part of a larger
entity and Elkes is given authority, duties or
responsibilities
